Land Compensation Act 1973

Advance payment of compensation E+W

52 Right to advance payment of compensation. E+W

(1) Where an acquiring authority have taken possession of any land the authority shall, if a request in that behalf is made in accordance with subsection (2) below, make an advance payment on account of any compensation payable by them for the compulsory acquisition of any interest in that land.

[F1 (1A) If the acquiring authority have taken possession of part of the land—

(a) specified in a notice of entry, or

(b) in respect of which a payment into court has been made,

the compensation mentioned in subsection (1) is the compensation payable for the compulsory acquisition of the interest in the whole of the land.

(1B) Notice of entry and payment into court must be construed in accordance with section 5A of the Land Compensation Act 1961.]

(2) Any request under this section shall be made by the person entitled to the compensation (hereafter referred to as “the claimant”), shall be in writing, shall give particulars of the claimant’s interest in the land (so far as not already given pursuant to a notice to treat) and shall be accompanied or supplemented by such other particulars as the acquiring authority may reasonably require to enable them to estimate the amount of the compensation in respect of which the advance payment is to be made.

(3) Subject to subsection (6) below, the amount of any advance payment under this section shall be equal to 90 per cent. of the following amount, that is to say—

(a) if the acquiring authority and the claimant have agreed on the amount of the compensation, the agreed amount;

(b) in any other case, an amount equal to the compensation as estimated by the acquiring authority.

(4) Any advance payment under this section shall be made not later than three months after the date on which a request for the payment is made in accordance with subsection (2) above or, if those three months end before the date on which the acquiring authority take possession of the land to which the compensation relates, on the date on which they take possession as aforesaid.

F2 [( 4A ) Where, at any time after an advance payment has been made on the basis of the acquiring authority’s estimate of the compensation, it appears to the acquiring authority that their estimate was too low, they shall, if a request in that behalf is made in accordance with subsection (2) above, pay to the claimant the balance of the amount of the advance payment calculated as at that time.

(5) Where the amount, or aggregate amount, of any payment under this section made on the basis of the acquiring authority’s estimate of the compensation exceeds the compensation as finally determined or agreed, the excess shall be repaid; and if after any payment under this section has been made to any person it is discovered that he was not entitled to it, the amount of the payment shall be recoverable by the acquiring authority.]

[F3 (6) If the land is subject to a mortgage sections 52ZA and 52ZB apply.]

(7) Any advance payment on account of compensation in respect of an interest which is settled land for the purposes of the M1 Settled Land Act 1925 shall be made to the persons entitled to give a discharge for capital money and shall be treated as capital money arising under that Act.

(8) [F4 Before] an acquiring authority make an advance payment under this section on account of compensation in respect of any interest in land they shall deposit with the council of the district or London borough [F5 or Welsh county or county borough] in which the land is situated particulars of the payment [F6 to be made], the compensation and the interest in land to which it relates;. . . F7

[F8 (8A) Any particulars deposited pursuant to subsection (8) above shall be a local land charge and for the purposes of the M2 Local Land Charges Act 1975 the council with whom any such particulars are deposited shall be treated as the originating authority as respects the charge thereby constituted. ]

(9) [F9 Where a local land charge is registered in the F10 ... local land charges register pursuant to subsection (8A) above and the advance payment to which the charge relates is made to the claimant, then if thereafter he] disposes of the interest in the land to, or creates an interest in the land in favour of, a person other than the acquiring authority, the amount of the advance payment [F11 together with any amount paid under section 52A]shall be set off against any sum payable by the authority to that other person in respect of the compulsory acquisition of the interest disposed of or the compulsory acquisition or release of the interest created.

(10) Where an advance payment has been made under this section on account of any compensation—

(a) section 76 of the M3 Lands Clauses Consolidation Act 1845 and section 9 of the M4 Compulsory Purchase Act 1965 (refusal of owner to convey on tender of compensation) shall have effect as if references to the compensation were references to the balance thereof remaining unpaid F12 . . .

(11) Where the acquiring authority, instead of taking possession of any land, serve a notice in respect of that land under [F13 section 583 of the Housing Act 1985](notice authorising existing occupier to continue in occupation where house acquired for housing purposes) this section shall have effect as if they had taken possession of the land on the date on which the notice is served.

(12) This section shall apply to compensation for the compulsory acquisition of a right over land as it applies to compensation for the compulsory acquisition of an interest in land, and shall so apply with the necessary modifications and as if references to taking possession of the land were references to first entering it for the purpose of exercising the right.

(13) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F14

Textual Amendments

F1 S. 52(1A)(1B) inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(2)(a); S.I. 2004/2593, art. 2(a)

F2 S. 52(4A)(5) substituted for s. 52(5) (25.09.1991 subject to the restrictions referred to in S.I. 1991/2067, art. 4) by Planning and Compensation Act 1991 (c. 34, SIF 28:1), s. 63(1) (with s. 84(5)); S.I. 1991/2067, art. 3.

F3 S. 52(6) substituted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(2)(b); S.I. 2004/2593, art. 2(a)

F4 Word substituted by Local Land Charges Act 1975 (c. 76), s. 19, Sch. 1

F5 Words in s. 52(8) inserted (1.4.1996) by 1994 c. 19, s. 66(6), Sch. 16 para. 40(3) (with ss. 54(5)(7), 55(5), 66(7), Sch. 17 paras. 22(1), 23(2)); S.I. 1996/396, art. 4, Sch. 2

F6 Words inserted by Local Land Charges Act 1975 (c. 76), s. 19, Sch. 1

F7 Words repealed by Local Land Charges Act 1975 (c. 76), s. 19, Sch. 1

F8 S. 52(8A) inserted by Local Land Charges Act 1975 (c. 76), s. 19, Sch. 1

F9 Words substituted by Local Land Charges Act 1975 (c. 76), s. 19, Sch. 1

F10 Word in s. 52(9) omitted (12.4.2015) by virtue of Infrastructure Act 2015 (c. 7), s. 57(5)(e), Sch. 5 para. 33 (with Sch. 5 Pt. 4)

F11 Words in s. 52(9) inserted (25.09.1991 subject to the restrictions referred to in S.I. 1991/2067, art. 4) by Planning and Compensation Act 1991 (c. 34, SIF 28:1), s. 70, Sch. 15 para. 24(a) (with s. 84(5)); S.I. 1991/2067, art. 3.

F12 Words in s. 52(10) repealed (25.09.1991 subject to the restrictions referred to in S.I. 1991/2067, art. 4) by Planning and Compensation Act 1991 (c. 34, SIF 28:1), ss. 70, 84(6), Sch. 15 para. 24(b), Sch. 19 Pt. III (with s. 84(5)); S.I. 1991/2067, art. 3.

F13 Words substituted by Housing (Consequential Provisions) Act 1985 (c. 71, SIF 61), s. 4, Sch. 2 para. 24(6)

F14 S. 52(13) repealed by Land Compensation (Scotland) Act 1973 (c. 56), Sch. 2 Pt. I

Marginal Citations

M1 1925 c. 18.

M2 1975 c. 76.

M3 1845 c. 18.

M4 1965 c. 56.

[F15 52ZA Advance payments: land subject to mortgage E+W

(1) This section applies if—

(a) an acquiring authority take possession of land,

(b) a request is made in accordance with section 52(2) for an advance payment, and

(c) the land is subject to a mortgage the principal of which does not exceed 90% of the relevant amount.

(2) The advance payment made to the claimant must be reduced by the amount the acquiring authority think will be required by them to secure the release of the interest of the mortgagee (or all the mortgagees if there is more than one).

(3) The acquiring authority must pay to the mortgagee the amount the acquiring authority think will be required by them to secure the release of the mortgagee’s interest, if—

(a) the claimant so requests, and

(b) the mortgagee consents to the making of the payment.

(4) If there is more than one mortgagee—

(a) subsection (3) applies to each mortgagee individually, but

(b) payment must not be made to a mortgagee before the interest of each mortgagee whose interest has priority to his interest is released.

(5) The amount of the advance payment made to the claimant under section 52 and the amount of the payments made to mortgagees under this section must not in aggregate exceed 90% of the relevant amount.

(6) Subsection (7) applies if—

(a) the acquiring authority estimated the compensation,

(b) it appears to the acquiring authority that their estimate was too low and they revise the estimate, and

(c) a request is made by the claimant in accordance with section 52(2).

(7) The provisions of subsections (2) to (5) must be re-applied on the basis of the revised estimate.

Textual Amendments

F15 Ss. 52ZA-52ZC inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(3); S.I. 2004/2593, art. 2(a)

52ZB Advance payments: land subject to mortgage exceeding 90% threshold E+W

(1) This section applies if—

(a) an acquiring authority take possession of land,

(b) a request is made in accordance with section 52(2) for an advance payment, and

(c) the land is subject to a mortgage the principal of which exceeds 90% of the relevant amount.

(2) No advance payment is to be made to the claimant.

(3) But the acquiring authority must pay to the mortgagee the amount found under subsection (4), if—

(a) the claimant so requests, and

(b) the mortgagee consents to the making of the payment.

(4) The amount is whichever is the lesser of—

(a) 90% of the value of the land;

(b) the principal of the mortgagee’s mortgage.

(5) The value of the land is the value—

(a) agreed by the claimant and the acquiring authority, or (failing such agreement)

(b) estimated by the acquiring authority.

(6) For the purposes of subsection (5) the value of the land is to be calculated in accordance with rule 2 of section 5 of the Land Compensation Act 1961 (market value), whether or not compensation is or is likely to be assessed in due course in accordance with rule 5 of that section (equivalent re-instatement).

(7) If there is more than one mortgagee, payment must not be made to a mortgagee until the interest of each mortgagee whose interest has priority to his interest is released.

(8) But the total payments under subsection (3) must not in any event exceed 90% of the value of the land.

(9) Subsection (10) applies if—

(a) the acquiring authority estimated the compensation,

(b) it appears to the acquiring authority that their estimate was too low and they revise the estimate,

(c) the condition in section 52ZA(1)(b) would have been satisfied if the revised estimate had been used instead of their estimate, and

(d) a request is made by the claimant in accordance with section 52(2).

(10) The provisions of section 52ZA(2) to (5) must be applied on the basis of the revised estimate.

(11) If—

(a) the acquiring authority estimated the value of the land,

(b) it appears to the acquiring authority that their estimate was too low and they revise the estimate, and

(c) a request is made by the claimant in writing,

any balance found to be due to a mortgagee on the basis of the revised estimate is payable in accordance with this section.

Textual Amendments

F15 Ss. 52ZA-52ZC inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(3); S.I. 2004/2593, art. 2(a)

52ZC Land subject to mortgage: supplementary E+W

(1) This section applies for the purposes of sections 52ZA and 52ZB.

(2) The claimant must provide the acquiring authority with such information as they may require to enable them to give effect to those sections.

(3) A request under section 52ZA(3) or 52ZB(3) must be made in writing and must be accompanied by the written consent of the mortgagee.

(4) Subsections (4) and (8) to (9) of section 52 apply to a payment which may be or is made under section 52ZA or 52ZB as they apply to a payment which may be or is made under section 52.

(5) The relevant amount is the amount of the compensation agreed or estimated as mentioned in section 52(3).

(6) If the land is subject to more than one mortgage, the reference in sections 52ZA(1)(c) and 52ZB(1)(c) to the principal is to the aggregate of the principals of all of the mortgagees.

(7) A payment made to a mortgagee under section 52ZA or 52ZB—

(a) must be applied by the mortgagee in or towards the discharge of the principal, interest and costs and any other money due under the mortgage;

(b) must be taken to be a payment on account of compensation and treated for the purposes of section 52(10) as if it were an advance payment made under section 52;

(c) must be taken, with effect from the date of the payment, to reduce by the amount of the payment the amount in respect of which interest accrues for the purposes of section 11(1) of the Compulsory Purchase Act 1965, any bond under Schedule 3 to that Act or section 85 of the Lands Clauses Compensation Act 1845;

(d) must be taken into account for the purposes of determining any payments (or payments into court) which may be made for the purposes of sections 14 to 16 of the Compulsory Purchase Act 1965.

(8) If the amount, or aggregate amount, of any payments under—

(a) sections 52 and 52ZA, or

(b) section 52ZB,

on the basis of the acquiring authority’s estimate of the compensation exceed the compensation as finally determined or agreed, the excess must be repaid by the claimant.

(9) No payment must be made to a mortgagee—

(a) if any of the circumstances mentioned in subsection (10) applies, or

(b) if the compulsory acquisition is only of a right over land.

(10) The circumstances are—

(a) payment has been made under section 14(2) of the Compulsory Purchase Act 1965;

(b) a notice under section 14(3) of that Act has been given;

(c) there is an agreement under section 15(1) or 16(1) of that Act or the matter has been referred to the [F16 Upper Tribunal] under that section.

(11) The claimant in relation to settled land for the purposes of the Settled Land Act 1925 is the persons entitled to give a discharge for capital money.]

Textual Amendments

F15 Ss. 52ZA-52ZC inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(3); S.I. 2004/2593, art. 2(a)

F16 Words in s. 52ZC(10)(c) substituted (1.6.2009) by The Transfer of Tribunal Functions (Lands Tribunal and Miscellaneous Amendments) Order 2009 (S.I. 2009/1307), art. 1, Sch. 1 para. 108 (with Sch. 5)

[F17 52A Right to interest where advance payment made. E+W

(1) This section applies where the compensation to be paid by the acquiring authority for the compulsory acquisition of any interest in land would (apart from this section) carry interest under section 11(1) of the Compulsory Purchase Act 1965 or any bond under Schedule 3 to that Act or section 85 of the Lands Clauses Consolidation Act 1845.

[F18 (2) If the authority make a payment under section 52(1) to any person on account of the compensation—

(a) they must at the same time make a payment to that person of accrued interest, for the period beginning with the date of entry, on the amount of the compensation agreed or estimated under section 52(3) (the total amount), and

(b) the difference between the paid amount and the total amount is an unpaid balance for the purposes of this section.

(2A) The paid amount is—

(a) the amount of the payment under section 52(1), or

(b) if the land is subject to a mortgage, the aggregate of that amount and the amount of any payment made under section 52ZA(3).]

(3) If the authority make a payment under section 52(4A) above to any person on account of the compensation, they shall at the same time make a payment to him of accrued interest, for the period beginning with the date of entry, on—

(a) the amount by reference to which the payment under section 52(4A) above was calculated; less

(b) the amount by reference to which the preceding payment under section 52(1) or (4A) above was calculated.

(4) Where the authority make a payment under section 52(4A) above on account of the compensation, the difference between—

(a) the amount of the payment; and

(b) the amount by reference to which it was calculated less the amount by reference to which the preceding payment under section 52(1) or (4A) above was calculated,

is an unpaid balance for the purposes of this section.

(5) If, on an anniversary of the date on which the authority made a payment to any person under section 52(1) above on account of the compensation—

(a) the amount of accrued interest on the unpaid balance under subsection (2) above or, as the case may be,

(b) the aggregate amount of the accrued interest on any unpaid balances,

exceeds £1,000, the authority shall make a payment to the claimant of the amount or aggregate amount.

(6) The acquiring authority shall, on paying the outstanding compensation, pay the amount of the accrued interest on the unpaid balance under subsection (2) above or, as the case may be, the aggregate amount of the accrued interest on any unpaid balances.

(7) For the purposes of subsections (5) and (6) above, interest accrues on any unpaid balance for the period beginning with—

(a) the making of the payment under section 52(1) or, as the case may be, 52(4A) above; or

(b) if any payment has already been made in respect of that balance under subsection (5) above, the date of the preceding payment under that subsection.

(8) For the purposes of this section—

(a) interest accrues at the rate prescribed under section 32 of the Land Compensation Act 1961 or, in the case of a bond under section 85 of the Lands Clauses Consolidation Act 1845, at the rate specified in section 85; and

(b) the amount by reference to which a payment under section 52(1) or (4A) was calculated is the amount referred to in section 52(3)(a) or (b) for the purposes of that calculation.

(9) Where any payment has been made under section 52(1) above on account of any compensation, the acquiring authority is not required to pay interest under section 11(1) of the Compulsory Purchase Act 1965 or any bond under Schedule 3 to that Act or under section 85 of the Lands Clauses Consolidation Act 1845.

(10) Where the amount, or aggregate amount, of any payment under section 52 above made on the basis of the acquiring authority’s estimate of the compensation is greater than the compensation as finally determined or agreed and, accordingly, the interest paid under this section is excessive, the excess shall be repaid.

(11) If after any interest has been paid to any person under this section on any amount it is discovered that he was not entitled to the amount, the interest shall be recoverable by the acquiring authority.

(12) The Secretary of State may from time to time by order substitute another sum for the sum specified in subsection (5) above; and the power to make orders under this subsection shall be exercisable by statutory instrument which shall be subject to annulment in pursuance of a resolution of either House of Parliament.]

Textual Amendments

F17 S. 52A inserted (25.09.1991 subject to the restrictions referred to in S.I. 1991/2067, art. 4) by Planning and Compensation Act 1991 (c. 34, SIF 28:1), s. 63(2) (with s. 84(5)); S.I. 1991/2067, art. 3.

F18 S. 52A(2)(2A) substituted for s. 52A(2) (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 104(4); S.I. 2004/2593, art. 2(a)

Modifications etc. (not altering text)

C1 S. 52A modified by 1961 c. 33, s. 5A(5)(6) (as inserted (31.10.2004) by Planning and Compulsory Purchase Act 2004 (c. 5), s. 103(2); S.I. 2004/2593, art. 2(a))